KEY POINTS:
Freightways has bought information management businesses on both sides of the Tasman.
The freight and logistics company today announced it was paying up to A$8.7 million ($9.7 million) for Brisbane's Shred-X Group, and $1 million for MSS in Christchurch.
Shred-X was Queensland's leading secure document destruction company, which had recently expanded into Victoria through acquisition, while MSS operated in the document storage niche, Freightways said.
The earnings before interest, tax, depreciation and amortisation (ebitda) increase for the year to next June resulting from the Shred-X purchase was expected to top A$1.4 million.
Including synergies gained by merging MSS into Freightways' established Archive Security business, incremental ebitda of $300,000 was expected in the 2008 financial year from MSS.
Freightways managing director Dean Bracewell said the Shred-X acquisition was consistent with Freightways' growth strategy of increasing its penetration into the Australian information management market.
It meant Freightways could now offer a complete package of information management services including document storage, data storage and document destruction to its Queensland customers.
In addition, Freightways had entered into a 50/50 joint venture arrangement with the founders of Shred-X to develop a purpose-built document destruction facility in Yatala, Queensland in 2008. The cost to Freightways of that development was A$2.5 million.
Mr Bracewell said Freightways had earlier signalled the information management market was a growth opportunity and it intended to continue to develop its presence on both sides of the Tasman.
Freightways shares were down 2c at noon today to $3.91.
- NZPA
